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F&S Assesses the Growing UCaaS Arena

North America’s hosted IP telephony and UCaaS space last year saw greater than 30 percent growth. We can expect double-digit growth in this arena through 2023. And, Frost & Sullivan says, there’s still lots of runway and the potential for more disruption.

In 2016 installed users increased by 32.1 percent, according to the research firm. Meanwhile, there was 30.6 percent revenue growth – not including access – in the market. That was driven in part by digital transformation efforts and premises-based solutions reaching end of life.

8x8, NetFortris/Fonality, RingCentral, and Vonage are among the market leaders, Frost & Sullivan says. It adds that Cisco, Microsoft, Unify, and Zang are among the market disruptors. PanTerra, Rogers Communications, Verizon have also disrupted the market with innovative offerings, it says.

Frost & Sullivan also notes that Star2Star has a unique business model. And it says that Jive and Nextiva are known for their “customer service excellence.”

Others it calls out by name include AT&T, CenturyLink, Comcast, EvolveIP, Fuze, Intermedia, Mitel, West, and Windstream. Speaking of Mitel and Windstream, F&S notes these suppliers are shifting the industry balance with big acquisitions. (And, in another major UC acquisition, Cisco last month announced plans to buy BroadSoft.)

“UCaaS continues to provide a richer and more cost effective collaborative communication system for businesses globally,” said Synergy Research Group’s Jeremy Duke. “We are also seeing an upmarket acceleration of UCaaS adoption, moving from serving mostly smaller sized organizations now to gaining traction in businesses of over 100 seats and over 1,000 seats. Given that the displacement of premise[s] PBXs remains low today, there is ample ground for UCaaS to find strong growth in displacing these legacy systems over a long stretch of time.”

Global Market Insights says the overall UC market is poised to reach $96 billion by 2023. And it notes the expected proliferation of hosted products in this category. Technavio, meanwhile, says global VoIP services market is poised for a 9.87 percent compound annual growth rate between this year and 2021.